S&P affirms ratings on Zagreb, HBOR, raises rating on Zagrebacki Holding company

Standard & Poor's (S&P) Global Ratings earlier this week affirmed its 'BB/B' long-and short- issuer credit ratings on Croatia's 100% state-owned development bank -- the Croatian Bank for Reconstruction and Development (HBOR), and raised its long-term corporate credit rating on Zagrebacki Holding municipal services company to 'BB-' from 'B+'.

The agency also affirmed the 'BB' rating on Croatia's capital Zagreb, with negative outlook.

"Zagreb has demonstrated its ability to withstand challenges to its revenue-raising capacity following changes to Croatia's personal income tax regime last year. The city continues to demonstrate very string budgetary performance in line with our base-case scenatio," S&P said.

"We equalise the ratings on HBOR with those on Croatia. We assess that the sovereign is almost certain to provide timely  and sufficient extraordinary support to HBOR in the event of financial distress," S&P said in a statement.

The agency on Friday raised its long-term corporate rating on Zagrebacki holding by one notch, citing improved financial standing and liquidity position of the company.

"The rating action reflects our view that the Zagrebacki Holding management has made substantial successful efforts to improve its financial standing and liquidity position. These efforts include the refinancing of short-term debt, extension of its maturity profile, improvement of the company's liquidity and optimisation of business operations through cost reductions and strategic decision-making," S&P said.

Last update: Sat, 23/07/2016 - 13:15

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